Connecticut Makes Deep Cuts In Health Insurers’ Rate Requests

Individual plans for 2019 will have an average increase of 2.7 percent, down from an average request of about 12 percent.

Rapidly Rising Connecticut Health Insurance Rates May Slow In 2019 »

For small group plans, the average increase will be 3.1 percent, more than one-third less than the requested average of more than 10 percent.

Commissioner Katharine Wade said that although the cost of medical services and demand are the "main cost driver," regulators believed the impact from federal health care policies will be less than the industry has warned.

For example, the state Insurance Department determined there would be limited impact from a lack of enforcement of the individual mandate that is a key part of the Affordable Care Act, also known as Obamacare. President Donald Trump and the Republican-led Congress dropped the mandate effective next year.

"While the federal government officially removed the individual mandate penalty for 2019, the department and carriers accounted for this in the 2018 rates," Connecticut regulators said.

The state also determined there would be marginal impact from the federal government's new regulations for short-term, limited-duration health plans and association health plans, state regulators said. Carriers filed their rates in July while waiting for clarification from Washington, which came later in the summer.

For rates on the Affordable Care Act health exchange, the Insurance Department scaled back an average 9.1 percent increase for individual coverage sought by Anthem Health Plans to a cut of 2.7 percent. Nearly 46,000 people are affected.

For ConnectiCare Benefits Inc., a request for an average 13 percent incrase was reduced to 4 percent. ConnectiCare covers about 64,000 people on the exchange.

For Small Groups, Anthem's 9.9 percent increase was cut to 2.9 percent and ConnectiCare's 5.7 percent increase was reduced to zero.

"For the first time there will be more choice of innovative networks and plan cost-sharing options for consumers on the exchange," Wade said.

A spokeswoman for Anthem said the insurer was studying the Insurance Department's decision and did not comment.

ConnectiCare said it is evaluating the impact of the decisions on the company.

"We remain concerned with the viability of both the individual and small group markets in 2020 and beyond," it said.

Anthem and ConnectiCare told state regulators that younger and healthier people are exiting the market, leaving insurers to serve older and sicker people with costlier health insurance needs.

They also complained about the loss of the individual mandate next year, saying it will further skew the market and drive up rates.

Still, rate requests by 10 health insurers covering about 293,000 customers for next year would rise more quickly than inflation, but on average were below last year's increases.

Consumers who spoke at an Insurance Department hearing last week were not impressed and urged regulators to stem rapidly rising health insurance costs.